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Assessing the economic impact of going public: evidence from firm-level data in the euro area

Author

Listed:
  • Böninghausen, Benjamin
  • Evrard, Johanne
  • Gati, Zakaria
  • Gori, Sofia
  • Lambert, Claudia
  • Schuster, Wagner Eduardo

Abstract

Listing equity in public markets can provide firms access to new capital and investment opportunities, benefiting the broader economy. But how does listing affect profitability and investment? To identify the "pure" effect of listing, we use propensity score matching and a staggered difference-in-difference approach. Using euro-area firm-level data, we compare public and private firms to explore listing's broader economic impact. We show that firms’ profitability increases after listing – indicative of wider economic benefits. Listed firms however seem to invest less long-term, indicating potential short-termism.

Suggested Citation

  • Böninghausen, Benjamin & Evrard, Johanne & Gati, Zakaria & Gori, Sofia & Lambert, Claudia & Schuster, Wagner Eduardo, 2025. "Assessing the economic impact of going public: evidence from firm-level data in the euro area," Economics Letters, Elsevier, vol. 256(C).
    • Handle: RePEc:eee:ecolet:v:256:y:2025:i:c:s0165176525004161
    DOI: 10.1016/j.econlet.2025.112579
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    References listed on IDEAS

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    Keywords

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    JEL classification:

    • G10 - Financial Economics - - General Financial Markets - - - General (includes Measurement and Data)
    • G30 - Financial Economics - - Corporate Finance and Governance - - - General
    • L10 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - General
    • G32 - Financial Economics - - Corporate Finance and Governance - - - Financing Policy; Financial Risk and Risk Management; Capital and Ownership Structure; Value of Firms; Goodwill
    • L21 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Business Objectives of the Firm
    • L25 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Firm Performance

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